Overview
- Inegi’s mid-June release showed private gross fixed capital formation fell 3.5% quarter-on-quarter and 4.46% year-on-year in Q1 2026, extending a run of quarterly declines and marking the weakest start to a year since 2009 excluding 2020.
- Total gross fixed capital formation contracted about 3.0% in Q1 2026 and amounted to 21.2% of GDP, with private investment contributing 17.9 percentage points and public investment 3.3 points.
- Foreign direct investment reached a record roughly $23.6 billion in Q1 2026, an increase of about 10.4% year-on-year, but it represented only about 5.5% of total fixed investment and could not offset the private shortfall.
- The shortfall leaves Mexico off track from Plan México’s 2026 IFB-to-GDP target of 25%, with analysts pointing to legal and regulatory uncertainty, tight financial conditions, and business caution as drivers of the private pullback.
- The decline in private capital spending threatens near-term growth and job creation because private investment supplies most new productive capacity; policymakers will need steps that restore legal certainty and private confidence to avoid further erosion in coming quarters.